What happened

Shares of QuinStreet Inc. (QNST 1.02%) were down 18.8% as of 12:30 p.m. EDT Wednesday after the performance marketing company fell in the crosshairs of a noted short-seller.

In a report early today, Kerrisdale Capital revealed it's shorting QuinStreet to bet that the company's "outdated business model is unlikely to be a long-term survivor in the rapidly changing world of online advertising."

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So what

Kerrisdale further called QuinStreet's recent revenue growth a "sham," and primarily the result of "malware redirects, bogus leads [...], and a one-time lucky deal with Progressive that has already plateaued."

To be fair, not everyone is convinced by Kerrisdale's claims. Stephens analyst John Campbell came to QuinStreet's defense just before noon today, noting that Kerrisdale "repeats many of the same items seen in past short reports." Campbell added that QuinStreet appears to be delivering healthy growth even excluding acquisitions and the Progressive agreement." He also stated that the company could be an attractive takeout candidate, and maintained his overweight rating and $11.50-per-share price target on the stock.

Now what

QuinStreet shares had more than tripled over the past year as of yesterday's close, including a 35% single-day pop in early February as the company boosted its annual guidance after its latest quarterly results significantly exceeded expectations. So it's not terribly surprising that some short-sellers might view it as an easy target.

Nonetheless, and whether Kerrisdale's claims hold merit or not, it's equally unsurprising to see the stock pulling back today.